Google Music Rumors Gain More Steam
Google’s Rubin is now speaking to the Harry Fox Agency is a sure sign that talks with record labels have gone smoothly enough for Google to move to the next level. The New York-based Harry Fox Agency collects and distributes license fees to music publishers and houses rights to some 27,000 songs.
The entry of Google into the music business is something that anyone associated with the space should monitor closely. While some think that Internet radio is not really competition for satellite, the entrance of Google could prove that the space is viable. Google does not simply move into a space without a plan in place. They have dominated smart phone sales thus far in 2010, putting a major dent into a business that many thought belonged to Apple. The Google rumors, including a cloud based system, have many competitors scrambling to keep up.
Satellite Radio investors should take note, but at the same time can have confidence in the advantages that satellite delivery has. Satellite radio is still the best method for consumers to access to notch content in their cars. Still, technology will not remain still, and Sirius XM, if they plan on participating in Internet delivered radio, needs to start some major planning as soon as possible. Why should satellite take note? Another form of potential expansion for satellite radio is through smart phones, and in the longer term by adding more nations to the service. In France, Orange, a major carrier just signed an exclusive deal with Deezer for music content. The exclusive deals on the international stage are similar to the exclusive deals sought by Sirius and XM when they were competitors. If exclusive deals in Europe continue, it could lock out international expansion for Sirius XM before it ever gets started.
In the short term, Sirius XM can march along on their way to profits as they have been, but anyone considering long term must entertain the possibilities that the Internet will make its way into cars sooner than many anticipated only a few years ago. It is already there for millions that have smart phones. Getting in the dashboard of an OEM is no longer about a chipset, it is about a USB port or bluetooth connectivity.
Sirius XM reported 583,000 subscribers for Q2 and will be reporting their quarterly results on August 4th.. They could well match that subscriber tally in Q3 and Q4. This represents great growth potential in the near term that can not be ignored. Could we see a satellite vs. terrestrial vs. Internet in the next few years? The possibility certainly exists. For those wondering why some media analysts are not as bullish as they might be…Google and Internet Radio could be a factor.
[via NYPOST]
Position – Long Sirius XM, No Position Google or Apple
This is really excellent news if and when it happens. I have been looking for a way to tag Sirius songs to buy them later on my Droid. The way my friends do it on the iPhone.
Google really should compete with Apple’s iTunes. It’s a great move. Would really improve the Droid Sirius app immensely.
I am just re-reading your article Spencer. The NY Post story you linked talks about Google starting a music store similar to iTunes. It doesn’t talk about an internet radio service from Google. I think you misinterpreted the Post article.
I think it ould be absolutely fantastic if Google competed with iTunes.
Once it is cloud based it is essentially internet radio. Google has many options open
My reading is it will be purchasing songs for downloading (whether that is to the phone or cloud based). It seems to be a music store they are working on. Not radio.
Competition for iTunes is long overdue and inevitable. I like the concept a lot! Especially for Droid Sirius app users like me. It will make the app much more useful. We could also use recording in addition to tagging for purchase.
I’m not sure if Sirius will have a harder time overcoming analysts doubt or yours. I know your just trying to make us aware, but you seem to be pessimistic.